United Overseas Bank’s Quek Ser Leang notes that USD/CNH retains a downside bias in both the 24-hour and 1–3 week horizons, with key support around 6.7600 and strong resistance at 6.7820. Short-term momentum is building but still seen as insufficient to clearly break 6.7600, while a tentative 1–3 month recovery would require a move above the 21-week EMA near 6.8430.

Downside bias with key levels watched

"24-HOUR VIEW: Yesterday, we stated that last Friday’s “price action provides no fresh clues.” We also indicated that USD “could trade in a range between 6.7710 and 6.7820.” Instead of trading in a range, USD dipped to a low of 6.7662, closing 0.12% lower at 6.7700. Downward momentum is building, and USD is likely to trade with a downside bias today. That said, USD does not appear to have enough momentum to break below 6.7600. To sustain the momentum build-up, USD must hold below 6.7755."

"1-3 WEEKS VIEW: Last Wednesday (15 Jul, spot at 6.7720), we highlighted that “downward momentum is increasing, and USD is likely to trade with a downside bias toward 6.7600.” While USD subsequently dropped to a low of 6.7649, it has not been able to make further headway on the downside. That said, we will continue to hold the same view as long as 6.7820 (no change in ‘strong resistance’ level) is not clearly breached."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)